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This is the conclusion reached by the Provincial Appeal Court of Alicante in its judgement number 1476/19 on 20 December 2019, which ruled on an appeal lodged by the defendant companies against the judgement of the European Union Trade Mark Court of First Instance Number 1.
Background
Mr. Wonderful Communication S.L. filed a claim against two companies for infringement of its EU designs, national designs and unfair imitation. It actually claimed an exclusive right for an alleged design style in its legal action. The Court of First Instance partially ruled in favour of the plaintiff’s claim in judgement number 75/17 of 6 May 2019, which admitted the action for imitation, according to Article 11.2 of the Spanish Unfair Competition Act, but acquitted the defendant for the rest of the petitions.
The company Cial Lama S.L. lodged an appeal against the judgement of the lower court, basically alleging that the regulation had not been correctly applied, infringing the doctrine of the Supreme Court on unfair imitation and because the evidence submitted in the proceedings had not been suitably assessed.
The appeal was admitted because the court considered the following: (i) there was no imitation; (ii) even if there had been imitation, that would not have affected Mr. Wonderful’s designs because they are not of a particularly competitive nature; and (iii) even if there had been imitation and that had affected elements of a particularly competitive nature, no unfair competition had been committed because the conditions were not met to determine that the imitation was unfair (Legal Ground 4, Page 12). We will briefly analyse these aspects below.
Regarding the imitation
The judgement considered that there was no imitation because Mr. Wonderful had not proven such aspect. In fact, it was shown that the style it claimed consisted of the use of common elements that are in the public domain and are trends in the market sector.
In its grounds, the judgement of the Appeal Court stated that the only way to find coincidences between the drawings of the opposing companies is by extracting the different elements and forms contained in the drawings from their place of origin.
Another important aspect was the analysis of the elements that were considered imitated, which are common shapes used to represent objects: clouds, stars, hearts, the moon, rain, the sun and many others, combined with positive messages, and the use of pastel shades along with darker ones; in other words, elements that are in the public domain and cannot be monopolised.
The evidence even proved that Mr. Wonderful includes phrases or logos of third parties in its designs, specifically the design inspired by the Instagram logo and the use of the phrase “I love you to the moon and back”, which is a quote from the book “Guess How Much I Love You” by Sam McBratney (Legal Ground 4, Page 13).
In addition, the great deal of evidence submitted by the defendants in the proceedings and the different examples that were shown were proof of the existing market saturation for these kinds of drawings used on products. The judgement hence concluded the following:
“Therefore, either there is no imitation or, if there is, it would be difficult to sustain it is unfair within the context described”.
Another important aspect that was analysed in the legal grounds of the judgement was related to the conditions that must be met to determine that the imitation is unfair, in spite of the court considering that there was no imitation.
The elements that must be present in order to rule that the imitation is unfair, according to the case law of the Supreme Court, are those explained below:
- A particularly competitive nature and likelihood of association
In order to determine that the imitation is unfair it must result in a likelihood of association and this only occurs when the imitation is related to a feature that benefits from a particularly competitive nature.
The doctrine of the Supreme Court regarding unfair imitation excludes a feature from being of a particularly competitive nature when it is used on standardised products (forms generally used in the market sector) and it requires that the feature must have sufficiently different characteristics to other features of the same kind.
In this case, Mr. Wonderful did not manage to prove that it had been the creator of the style because it had not provided any evidence in that respect, neither a style book nor a study of the state of the art. In addition, the expert report issued by Cial Lama’s expert on Mr. Wonderful’s registered designs showed that these are structured with a combination of a series of elements from the collective imagination, the sets of drawings are not arranged in a specific way, there are a large number of solutions and they lack their own criteria.
In fact, Mr. Wonderful did not manage to prove its allegations. Firstly, it claimed it had created its own style that gives it its own particularly competitive nature, but it did not prove such style because it simply does the same thing as many other companies in the sector. It was neither able to prove that the public identifies its alleged style with the corporate origin of the products because it submitted no evidence to prove that consumers associate its drawings with a specific corporate origin.
Another important aspect we should mention is that the judgement stated that Cial Lama has its own registered trade mark that it uses to identify its products on the market. This fact prevents any likelihood of association, as can be seen from the case law of the Supreme Court.
- Unfairly taking advantage of another party’s prestige and efforts
The analysis conducted by the Appeal Court did not accept that any unfair conduct occurred by taking advantage of another party’s prestige because it considered that Mr. Wonderful’s style does not have a competitive advantage. Mr. Wonderful did not submit any evidence either to prove that its products are of a higher quality than those of the defendant.
The last requirement demanded by case law doctrine to rule that the imitation is unfair is taking advantage of another party’s efforts and that this is unfair. It is unfair when unauthorised reproduction takes place that leads to substantial savings in costs, above and beyond what would be admissible for the correct functioning of the market.
This fact was not proven by Mr. Wonderful either since Cial Lama has its own design team that creates the drawings used on the products it markets.
Conclusion
This judgement is not absolute since an appeal has been lodged to the Supreme Court (cassation), but it is certainly valuable because it shows us how important it is to prove all the facts that make imitation, which in principle can be freely carried out, unfair. Another aspect that should be pointed out is that the question has been left unanswered of what was used as support for Mr. Wonderful’s claim because no decision was adopted about the possibility to obtain an exclusive right for the design style.
For further information, please contact us at Vidal-Quadras & Ramon:
T. +34 93 548 02 08
www.vidalquadrasramon.com
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